Recession ahead?

The red line shows the shape of the yield curve. The yield curve keeps flattening (the red line is declining).

Note: peaks and bottoms in the yield curve lead by several months peaks and bottoms of consumer spending (blue line).

Bottom line - because of the flattening of the yield curve the odds favor a major slowdown in consumer spending.

Implications - weak commodities, lower EPS, stable or lower Treasury bond yields, and stocks going nowhere at best.

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Thank you for visiting this site.

George Dagnino, PhD
The Peter Dag Portfolio
Since 1977
Author, Profiting in Bull and Bear Markets

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